Viviane Reding argues for federal EU at Lausanne Summit

By: Jonathan Boyd | 20 Apr 2016

Viviane Reding, MEP and former vice president of the European Commission, has argued that the idea of a federal EU is not dead, as she provided the keynote to start the second day of the InvestmentEurope Fund Selector Sumit Lausanne 2016.

Summing up the challenges facing the region, she noted that a “United States of Europe” remains a long term goal, but requires a dose of “realpolitik” as well. This means that in practice a set of core eurozone members might pursue closer integration. Just how this path develops may to an extent depend on the outcome of the upcoming Brexit referendum in the UK, she added

She said that UK negotiators had often been involved in applying the brakes to EU proposals, which suggests that a vote to leave the EU would radically change the speed at which changes in Europe tend to be introduced by institutions such as the European Commission.

Reding also pointed to the failure of pan-European policy to be applied at the national level in the past as another key reason why deeper European integration is required; to ensure commonly agreed rules are applied the same way at the national level.

Reding outlined a number of factors such as trade deals and digitalisation that pose challenges to Europe’s economy, and which require a pan-European response.

She noted that both the US and China are engaged in negotiating trade deals as part of foreign policy. An example would be TPP, covering the Pacific, which could be seen as a play by the US to head of Chinese expansion – “TPP is a power grab by the US for 40% of global trade.”

But both China and the US are also negotiating from the position of wanting external trade to open up, while at the same time putting in place restrictions on competition from outside in their internal markets. This is the opposite to the European position, which is to open up the internal market. For example, in China, restrictions on foreign internet companies has led to the likes of Alibaba performing the role that Amazon has in other markets.

“Is it going to be a G2 or a G20?” Reding asked

Digitalisation

Reding also outlined key digitalisation developments and warned that a single European policy response was required to meet the associated challenges.

She referred to researc h suggesting that the value of digital services will exceed the value of goods traded across borders by 2019. But technologies such as Blockchain that are meant to support this are themselves built on weak policy grounds, she argued.

She said she did not believe that Blockchain cannot be manipulated. The pan-European policy response should start from the perspective of embracing, controling, and integrating such technology to maximise its benefits to Europeans.

Europe as a bloc can move forward better in the new digital world, she said